"Health food -- of all things -- may have gotten in the way of a marriage of snack-food titans.

"PepsiCo Inc., the maker of Doritos and Pepsi-Cola, explored a merger with Nestle SA in late spring, which would have created an immense global food concern with increasing emphasis on 'wellness' products. The effort was ultimately scuttled over a host of complications, according to people familiar with the matter.

"PepsiCo made the initial approach, according to a person familiar with the situation. But Nestle resisted the idea for fear that Pepsi's reliance on snacks such as potato chips and soft drinks would dilute its mission of building a business around more-healthful food and beverage products...

"PepsiCo declined to comment. A Nestle spokesman said the company 'has not been pursuing anything outside of our stated strategic acquisition interests, which are in the area of nutrition...'

"Indeed, Pepsi's move raises the question of what's next for the Purchase, N.Y., food conglomerate. Chairman and Chief Executive Indra Nooyi has steadily won over Wall Street investors with rock-solid sales and earnings growth. The company's shares traded yesterday at $66.13, about in the middle of its 52-week trading range.

"Without Nestle or another big acquisition, the question for Pepsi is how it will deepen its health-and-wellness portfolio, an effort it is increasingly emphasizing.

"After reformulating some of its foods with more-healthful oils in the U.S., it is doing the same overseas, where it is also reducing salt and adding oat and grain products. Yesterday, Pepsi, along with several other food companies, pledged to limit marketing to children.

"The risk to Pepsi is these nods to wellness will hurt sales, pushing the company's shares down. Without more-healthful brands that Pepsi can pitch to everyone, its growth prospects could be limited."

(“How Junk Food Spoiled Megadeal; Nestle's Wellness Drive Scotched PepsiCo Talks.” Dennis K. Berman, Deborah Ball and Betsy McKay. Wall Street Journal: July 19, 2007. pg. C.1)PERCEPTIONS, beliefs and assumptions again trump the numbers. Who are we? Why do we exist? What does that imply for where we can and should go, and how we get there?